Bill 18, the Stronger Workplace for a Stronger Economy Act, 2014, which received royal assent on November 20, 2014, introduced significant change to key provisions of the Employment Standards Act, 2000 (ESA). The changes will have a significant impact on employers including the potential for increased liability in cases of non compliance. Several of these changes are being phased in and several are already in effect. Key dates are highlighted in this summary. During this transition period, employers are well advised to review their existing practices to ensure compliance with all statutory requirements.
Bill 18 also introduced amendments to other employment related statutes including to the Occupational Health and Safety Act, Labour Relations Act, 1995 and the Workplace Safety and Insurance Act.
Summary of Key Changes to the ESA
Temporary Help Agencies and Clients
Bill 18 introduced several key changes to the temporary help agency provisions of the ESA. These changes come into force on November 20, 2015 and include the following:
- Both the temporary help agency and the client of the agency will be required to record the number of hours worked by each assignment employee in each day and each week;
- A temporary help agency will be required to ensure that the records it is required to maintain are readily available for inspection. This applies even where the temporary help agency has retained an external party to maintain and/or retain their records.
- The client of a temporary help agency will be required to retain or arrange for some other person to retain the records with respect to the work of each assignment employee for three years after the day or week to which the information relates and shall ensure that these records are readily available for inspection. This applies even where the client of the agency has retained an external party to maintain and/or retain their records.
The amendments also widen the scope of liability in cases where an employee of a temporary help agency is not paid his or her wages. The temporary help agency will be primarily responsible for paying wages to its employees. However, the ESA will now provide that a client of a temporary help agency can be held jointly and severally liable for outstanding wages owed to an assignment employee by the temporary help agency. This will apply to every client of the agency where the employee worked during the pay period in which the unpaid wages were earned. In the case of multiple assignments in such a pay period, each client may be held jointly and severally liable with the agency for a share of the total wages owed to the employee.
For purposes of these new “joint and several” liability provisions of the ESA, “wages” includes regular wages earned, overtime pay, public holiday pay and premium pay all earned during the relevant pay period. After the effective date, an employee of a temporary help agency will be able to pursue a claim for unpaid wages against a client of the agency even if the worker has not exhausted his/her options with the temporary help agency under the ESA. For the purposes of such a claim, the client of the temporary help agency will be deemed to be the employer of the worker. Employment standards officers can also issue orders against clients of the agency to enforce their liability.
No Maximum on Amount of Recovery and Retroactivity Extended
Effective February 20, 2015, the $10,000 cap on the recovery of unpaid wages will be repealed. This will apply only to wages that became due after February 20, 2015. The $10,000 cap will remain for all claims for wages that become due before February 20, 2015.
The time limits on the recovery of wages were also amended. Effective February 20, 2015, an employee will be able to recover wages that became due up to two years before the employee’s complaint was flied or, in the case of an inspection, before the ESO commenced the inspection (as opposed to six months). This will apply to all types of unpaid wages, including vacation pay. If, however, some or all of these wages became due to the employee before February 20, 2015, the ESO may not issue an order for wages that became due before that day if they became due more than six months before the complaint was filed or inspection was commenced. In the case of repeated violations, however, the time period is 12 months before February 20, 2015. In the case of vacation pay, the time period is 12 months before February 20, 2015.
Under this new regime, the potential liability for employers who are found to have violated the ESA provisions relating to wages will be significantly higher.
Self-audits for Employers
The ESA now empowers an Employment Standards Officer (“ESO”) to order an employer to conduct a “self-audit” upon written notice and to report any findings of that self-audit process as requested to the ESO.
If the employer identifies non-wage related contraventions of the ESA during a self-audit, the employer is required to advise the ESO of the steps that the employer has taken or will take to comply with the ESA. The ESO may still issue an order to pay wages or direct compliance with the ESA if the ESO believes it is appropriate to do so in the circumstances. Significantly, even if an employer reports that it is in compliance with the ESA, the ESO can still conduct an inspection or investigation of the workplace to determine whether or not the employer has complied with the ESA.
These self-audit provisions come into force on May 20, 2015.
In addition to posting the Minister’s most recent published poster in at least one conspicuous place at the workplace as is currently required, employers will now be required to also provide each employee with a copy of the poster within 30 days of an individual being hired, or, for existing employees, within 30 days of May 20, 2015 (the date in which changes regarding poster requirements come into force).
Indexing of Minimum Wage
The prescribed minimum wage rates will remain in place until September 30, 2015. After that date, the minimum wage rates will be adjusted in line with the Consumer Price Index of Ontario. The changes prohibit any decrease in the minimum wage rates. In addition, the government is required to review the minimum wage and the process for adjusting the minimum wage before October 1, 2020 and every five years after that date.
Occupational Health and Safety Act
As a result of Bill 18, the definition of “worker” under the Occupational Health and Safety Act is now amended to specifically include the following unpaid individuals:
- a secondary school student performing work or services under a school board authorized work experience programme;
- a person performing work or services under a college, university, or other post-secondary institution approved programme;
- a person who receives training from an employer but is not an employee under section 1(2) of the ESA as having met the “person receiving training” conditions; and
- any person who is prescribed by regulation.
Workplace Safety and Insurance Act, 1997
Bill 18 amends the Workplace Safety and Insurance Act, 1997 by adding and defining the term “temporary help agency”. For purposes of the WSIA, a temporary help agency will be defined as “an employer who primarily engages in the business of lending or hiring out the services of its workers to other employers on a temporary basis for a fee.” The Bill empowers the government to make certain regulations with respect to, among other things, allocation of employee injury and accident costs to the client of a temporary agency; deeming wages paid by the temporary help agency to the worker for work performed for the client would be deemed to be paid by the client; and the client of a temporary help agency’s notification obligations in the event of a workplace injury or accident.
These provisions are to come in to force at a date which is yet to be proclaimed. It remains to be seen what regulations, if any, the government will pass as a result.
Labour Relations Act, 1995
Bill 18 amends the construction industry provisions of the Labour Relations Act, 1995 by providing for, in certain cases, a two-month “open” period during which a union may apply to certify a group of employees already represented. It also amends the Act by provide a two-month “open” period during which employees may apply for a declaration that a union no longer represents the employees in certain cases. These changes become effective May 20, 2015.
Employment Protection for Foreign Nationals, 2009
Prior to Bill 18, the Employment Protection for Foreign Nationals, 2009 was generally restricted to live-in caregivers. As a result of Bill 18, the legislation will now apply to foreign nationals who are working or are attempting to find work in Ontario pursuant to an immigration or foreign temporary employee programme.